Coinbase Challenges SEC’s Claims on Token Transactions
In response to the Securities and Exchange Commission’s (SEC) claims that the transactions of 12 tokens met the definition of “investment contracts,” Coinbase has filed a response challenging those claims. John Deaton, on Twitter, pointed out that the SEC lacks the ability to claim that these transactions carry specific rights.
Key Points:
- The SEC cannot allege that transactions involving the 12 tokens on Coinbase’s platform carry specific rights.
- According to Deaton, these transactions are merely asset sales, where both buyer and seller fulfill their obligations at the time of the sale.
- Deaton believes any uncertainty on this matter should be dismissed based on the major questions doctrine, deferring to Congress’s authority to regulate the digital asset domain.
- Coinbase argues that the transactions on its platform are commodity sales, with obligations discharged entirely upon delivery of the digital token in exchange for payment.
- The initial recommendation by the SEC included as many as 200 tokens that could have been considered securities.
Hot Take: Coinbase’s response challenges the SEC’s classification of token transactions, emphasizing that they are asset sales rather than investment contracts. This raises questions about the SEC’s authority in determining the nature of these transactions and highlights the need for clearer regulation in the digital asset domain.
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